As in any booming economy, India's economic growth is being driven largely by the middle class. Notwithstanding our increased spending capabilities, we are aware of every rupee that goes out of our pockets. We are constantly on the lookout for the best product in terms of cost as well as returns. It is no different with insurance, health insurance in particular.
A relatively new type of health insurance plan called the Floater health insurance plan helps you get maximum benefit for money spent. This is a health insurance plan where all members of a family can be covered under the same plan for a single premium, with the sum assured available to any one member or to all members in case of any eventuality during the term of the policy.
The policy covers medical expenses incurred as an inpatient during hospitalization for more than 24 hours, including room charges, doctor/surgeon fee and medicines etc. This policy also covers expenses 30 days prior to hospitalization and 60 days post hospitalization.
So...what is the difference between regular health insurance plans and Floater health insurance plans?
We can study this with the following example. A family of three - husband (34 years), wife (33) and child (6) - with a regular health insurance policy pays a premium of Rs. 7580. The same family will have to pay only Rs. 6024 if they opt for a Floater policy.
In case of the regular health policy, you have to specify the sum insured against each family member. In the event of a claim, if the expenses move beyond that amount, you have to bear the difference. The Floater policy, on the other hand, provides each family member the benefit of the entire sum insured under the policy.
In the above-mentioned example, when the claim amount increased in the daughter's case, only the amount up to her respective sum insured would have been paid in case of Mediclaim. With the Floater plan, however, the full claim would have been paid out since the total sum insured of the family was Rs.300000 - the sum assured was available to any one of these three persons or to all the three persons in case of any eventuality during the tenure of the policy.
There is an upper limit in floater health insurance plan coverage of Rs. 3 lakhs.
Floater plans have some additional benefits, such as:
Free health checkup coupon for the senior most member of the insured family
An option for 2-year cover that offers a continuous 2-year protection with no increase in premium in the second year. This one time payment of premium for 2 years takes care of your renewal hassles for next year. The 1-year cover is also available.
No health check up required up to the age of 45 years (as on last birthday).
Income tax benefits under Section 80D (which from the current financial year has increased from Rs. 10,000 to Rs. 15,000) in the form of deduction from total taxable income. It is Rs 20,000 for senior citizens.
Policy Exclusions
30-day exclusion: Medical charges incurred, except those arising out of accidental injuries, within the first 30 days from the start date of the policy are not covered. This clause does not apply for subsequent renewal (without a break) of this policy.
The Floater policy is based on the probability of the number of people in a family falling ill during the year. A young family has a lower probability of falling ill, therefore the Floater policy can be an effective cost saver. As age increases, you should start looking to migrate to individual sum insured policies.
Author: Kairav Shah
www.apnainsurance.com
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